Comcast Routs the FCC: RIP Net Neutrality (and BitTorrents)

Net neutrality. There are two sorts of Americans: Those who not only know the term, but have been closely monitoring the ongoing Net neutrality debate, and those who have no idea what I’m talking about.

But the decision today by a federal appeals court, which slapped down the FCC and dealt a major blow to Net neutrality advocates, might just be the headline that gets mainstream America to start paying attention. (Scroll down to see just why exactly you should care)

Net neutrality essentially means the status quo. When you, the home internet user, currently turn on your computer and log online, you have paid an Internet service provider a certain amount of money for unrestricted access. You search what you want to search, stream whatever audio or video you wish. For those who no longer pay for their music – or movies or television – you saddle up to your BitTorrents and download whatever it is that you are pirating for the evening. This is all advocates mean when they say Net neutrality: All web traffic is treated equally by your service provider.

Some have even compared it to online free speech, where there is no online censoring or obstruction of web traffic.

But as online media has become richer and richer, and the spread of BitTorrents and web video has exploded, web service providers have started thinking about how to regulate traffic. Or at least how to charge more for those users who download the most data. Companies like Comcast say that resources are being drained by these top users, and a couple of years ago Comcast started taking measures to slow down and hamper BitTorrents transfers. Users would go to do something online, and suddenly discover that Comcast had closed that particular gate. (More at Techland: Apple’s iPad – 7 Must-Have Accessories)

In August of 2008, the Federal Communications Commission created something of a precedent by issuing a cease and desist order against the company. Just as the FCC has presided over the world of telecommunications, they had long been making moves to assert an array of Net neutrality rules and standards. And this move against Comcast – ordering them to remove any and all restrictions to BitTorrents – represented a firm declaration, that the FCC intended to monitor the Internet as well.

Now most Net neutrality conversations tend to revolve around freedom of speech or free enterprise. The passionate advocates for Net neutrality see the web as the ultimate space of unimpeded, unchecked, unregulated discourse. But Net neutrality critics typically point to the fact that Internet service providers are private companies, and should be able to conduct business however they see fit. It’s this last argument – along with the issue of pornography – that has caused consternation for many conservative politicians, who are supposed to be pro-business, pro-family as well as pro-individual rights. Some Republicans side with the corporations, as others are eager to regulate porn. Libertarians, meanwhile, believe in unregulated markets.

The political debate surrounding the issue has grown so heated that Congress has basically thrown up its hands – or stuck its head in the sand – rejecting five different bills in 2006 alone that would have empowered the FCC to police Net neutrality infractions. (More at Techland: 8 Netbooks Worth Buying Right Now)

Congress has thus far refused to act, so 2008 marked the year when the FCC took a stand on its own. And today’s unananimous decision by a three-judge appeals panel to toss out the FCC’s order, has not only taken the Net neutrality issue back to square one but has also sparked wider questions as to the FCC’s authority in regulating web commerce. “The Commission may exercise this ‘ancillary’ authority only if it demonstrates that its action – here barring Comcast from interfering with its customers’ use of peer-to-peer networking applications – is ‘reasonably ancillary to the . . . effective performance of its statutorily mandated responsibilities,'” the court said. “The Commission has failed to make that showing.”

What does that jargon mean? That the FCC has no real mandate to regulate the web, that its order against Comcast is beyond its authority, and then even something like the recently announced National Broadband Plan is now likely dead in the water. As part of that plan, the FCC was setting out to bridge the socioeconomic technological divide by expanding broadband in poor and rural communities, using money from the federal fund that subsidizes telephone service in those areas. Today’s court case effectively deems that plan to be beyond the FCC mandate.

So why should you care?

Well, for anyone who enjoys a good BitTorrent before dinner, here’s betting that you’ll soon notice slower downloads if you use Comcast – and most likely from other service providers as well. You’ll hear a lot of rumblings from Congress, about the importance of finally weighing in on the debate – though the poisoned well from the health care debate may run deep under this issue as well. The FCC could appeal the decision to the Supreme Court, though its quite uncertain that the high court would agree to hear the case, nor how they would fall on the Net neutrality issue. (Many Net neutrality advocates actually believe that a 2005 Supreme Court decision, which upheld the FCC’s deregulation of broadband, already gave too much freedom and control to the Internet service providers).

And then there are those who see a tiered Internet culture rapidly approaching on the horizon. Imagine a scenario in which your Internet access paralleled your access to cable television. For your basic fee, you get access to most basic web sites. But now Comcast can restrict which sites you access, and could charge a premium rate for premium access.

I, for one, think this scenario isn’t just possible, but likely. Providers have been fighting for some time to create preferential pricing models, to get the more aggressive Internet users to pay more for unlimited data. And after Tuesday’s decision, if I was in charge of Comcast, I’d already be devising ways to divvy up access, brainstorming how to squeeze more bucks out of more users. You want YouTube? Then order tier 2. Hulu? Tier 3? BitTorrents? Tier 4.

Forget philosophy or ideals; in an unregulated market, it just makes good business sense.